| dc.description.abstract | In an attempt to achieve high levels of performance, Commercial Banks have undergone a
number of challenges. Financial innovation in banking has been a relevant topic since mid
‘70s. Nowadays, also due to the present financial system situation, it comes to further
relevance. Despite the relevance of financial innovation and ever changing world, it’s
hard to list all financial innovations specifically. Adequate performance of financial
institutions is of crucial importance to their customers. Commercial banks like many
other financial service industries, facing a rapidly changing market, new technologies,
economic uncertainties, competition and demanding customers have created an
unprecedented set of challenges. The study sought to establish the effects of Mobile
money on the financial performance of the commercial banks in Kenya. The study
Objective was to determine the effects of mobile money on the financial performance of
commercial Banks in Kenya. The study target population was the 43 Commercial banks
in Kenya of 31st December 2013. The study used a descriptive survey design. The data
collection was secondary based where the mobile money data as calculated in of the
statement of the financial statement was obtained on the website and the statement of
comprehensive income from the annual financial statement reports of the commercial
banks on the website and the bank supervision annual report from 2008-2013 as
organized by the Central bank. The collected data was analysed using descriptive
statistics and multiple regression analysis. The study established that the financial
performance of the 43 commercial banks under study as represented by ROA values
increased by a mean ratio of 1.98 over the 5 year period. This is as represented by the
difference between the lowest mean of 2.14 in year 2009 and the highest mean of 4.12 in
year 2013 for the return on assets. Therefore, mobile money enhanced the financial
performance of commercial banks in Kenya. The study found out that there was a steady
decrease in the commercial banks’ capital expenses management ratio as reflected by the
decrease in mean values from 0.32 in year 2009 to 0.25 in year 2013. Therefore, the
expenses management ratio negatively affected the financial performance of the
commercial banks in Kenya over the 5 year period. Given that the mobile money of the
commercial banks steadily increased over the 5 year period and the commercial banks’
financial performance also steadily increased over the same period, the study concludes
that mobile money positively affected the financial performance of the commercial banks
in Kenya. From the findings the significance value was .004 which is less that 0.05 thus
the model is statistically significant in predicting how mobile money, capital ratio,
liquidity ratio, efficiency ratio, expenses management ratio and bank size affect financial
performance of commercial banks in Kenya. The F critical at 5% level of significance
was 3.23. Since F calculated (value = 8.64) is greater than the F critical (3.23), this shows
that the overall model was significant. | en_US |
